How well has your travel retail business recovered in 2022? When are you hoping to see a return to pre-pandemic sales?
2022 was a great year for GTR at Brown-Forman, as we’ve seen a steady approach to 2019 results. It is because of this recovery that we remain optimistic and confident about our future in GTR and what it holds. Thanks to our strong portfolio, the acquisition of new brands, and untapped geographic and channel opportunities, we see a bright future as we strengthen our positioning in the channel.
Which travel retail markets hold the best potential for growth in 2023? Where will challenges remain? Please outline your digital strategy and how you are looking to increase your online engagement in duty-free in 2023?
We expect growth to come from across the major geographies, Americas, EMEA other Asia Pacific (APAC). APAC holds new potential for growth again in 2023. We know the market in China has remained resilient to the pandemic and has been elevated by duty-free initiatives in Hainan with the support of the government. If we move beyond China and its current domestic travel retail, we can see that other leading duty free markets like South Korea, Thailand, India other Japan are opening up and expected to return to growth.
What trends do you think will shape the market in the first half of 2023?
Travel retail shoppers continue to have a strong interest in premium authentic brands in the Spirits category. Our launch of the travel retail exclusive range of Benriach addresses exactly this. The range (including Benriach Quarter Cask, Benriach Smoky Quarter Cask, Benriach Triple Distilled Ten yo and our oldest ever triple distilled expression, Benriach Triple Distilled 22 YO) was launched in May 2022 with the aim to enrich travellers’ journeys with a range of spirits that are authentic for the whiskey drinker and innovative for those looking for something fresh.
Recently, we announced the launch of our Travel Exclusive Jack Daniel’s American Single Malt Whiskey to be on shelves summer 2023. This expression of Jack Daniel’s, the first of its kind from Lynchburg, TN, directly addresses the consumer desire to trade up in the unique space of whiskey aged in Oloroso sherry casks.
With ESG being more important than ever, what steps are you taking to ensure your travel Is retail business as gender diverse and sustainably-minded as possible? What are your key goals for 2023?
At Brown-Forman, our Diversity and Inclusion strategy (titled Many Spirits, One Brown-Forman) includes our 2030 D&I ambitions to grow global female representation to 40% at the senior leadership level, and to increase US representation of underrepresented racial and ethnic groups at all management levels by 25%.
In GTR, we’re exemplifying this commitment through our specific Women in Travel Retail initiative, an in-depth evaluation and action to encourage women representation throughout our commercial function.
On the subject of environmental sustainabilityBrown-Forman is committed to halving our greenhouse gas emissions (GHG) across our owned operations and supply chain, to zero waste in our distilleries, and to 100% recyclable or reusable primary packaging by 2030.
In travel retail, we launched our specific sustainability targets in October 2021 and have held true to progress since then:
1. 100% Carbon Neutral Team Travel by 2022
2. Remove 100% of single use plastic from promotions by 2023
3. Remove or Replace 50% gift packaging by 2025
For more information regarding our Sustainability commitments at Brown-Forman, please visit: https://www.brown-forman.com/environmental-sustainability
What impact are global supply challenges and the cost of living going to pose in 2023? How do you want to navigate these?
We acknowledge that these are difficult times in the travel retail industry for many in the channel. We’re grateful to work in an industry that partners so closely to ensure we get through this trying time together. Suppliers, airports, and travel retailers have had to work quickly to mitigate the impact from a variety of challenges, and as a result of this crisis we’ve seen astounding developments in many aspects of the channel.
We continue to monitor the macroeconomic developments and looming challenges for consumers as a result of the varying degrees of disruption we are expected to experience in the coming months on a global scale. The initiatives we’ve developed and implemented to maintain relevance and continue to grow our brands keep me optimistic about the future of travel retail.
What new products or packaging are you going to either launch or promote in travel retail in the first half of 2023?
2022 marked the start of a new era with big, bold strategic initiatives for Brown-Forman, the likes of which we’ll see brought to life throughout 2023.
1. Product innovation with Jack Daniel’s American Single Malt. The first of its kind, this American Single Malt follows our signature charcoal mellowing process at the Jack Daniels’ Distillery in Lynchburg, Tennessee before being aged in hand-crafted charred oak barrels and finished in Oloroso Sherry Casks. This expression is bottled at 90 proof, and will hit shelves in key international airport locations from June 2023 (listed at $100 USD). We released a sneak peek of the Jack Daniel’s American Single Malt, traveler exclusive, at the TFWA Cannes trade show to our excited customers and the trade press.
2. New line Extensions with Woodford Reserve Double XO. Woodford Reserve Double XO is our GTR and China e-commerce exclusive with limited availability, that was launched in October 2022, Listed RRP (£115, $150, €135). Double XO is a marriage of two extraordinary finishes – the heavily toasted American oak casks from our Woodford Reserve Distillery in Versailles, Kentucky, and the rich flavors of fine fruits and spices from our XO Cognac casks.
3. Travel Retail Exclusives with Global Expansion (Jack Daniel’s Tennessee Travelers). Crafted for discovery, our Jack Daniel’s Tennessee Travelers Series—Bold & Spicy and Sweet & Oaky will be launched globally in Travel Retail in early 2023. The pair were launched in the fall of 2021 as a Heinemann exclusive, at 107 proof each.
4. Integration of new brands such as Gin mare, the number-one Ultra-Premium Gin in the world Gin Mare is a Spanish gin, with a strong presence in the Travel Retail space. More exciting news to come regarding the acquisition and more appropriately, our integration of Gin Mare into our existing portfolio of brands in travel retail.
5. Jack Daniel’s McLaren F1 Racing Partnership. We are excited as well to discuss the recent announcement of Jack Daniel’s as partner of McLaren F1 Racing, beginning next season (2023).Through the lens of travel retail, this new partnership allows us the opportunity to continue building our Jack Daniel’s brand alongside another bold, confident brand in McLaren.
6. In addition, we continue to expand our footprint in the spaces of traveler engagement and experiential activities. A great example of this would be the continued activation of the Woodford Reserve Sensory Loungewhich we recently activated in Paris CDG with cocktails crafted by The Red Door Bar and chocolates from La Maison du Chocolat to promote contextual relevance for the traveller.
